Insurance News

THE General Insurance Association of Malaysia (Piam) has embarked on a dual mission – further promoting information sharing related to fraud between its members, and compiling a comprehensive anti-fraud database – to combat this widespread menace in the industry. Executive director Lim Chia Fook said this was important for the insurance industry, as fraud by nature was a hidden crime; and among ways to prevent it were having a strong database and enhancing information sharing between insurers. “In some classes of business, for example, motor insurance, we already have an existing comprehensive database; and the association is updating it from time to time. Piam, however, is still gathering information and compiling data on fire, personal accident and medical health cases. “We need to build up an adequate database system as well as step up information sharing in these areas to facilitate future investigations,” Lim said in an interview with StarBiz. Through sharing information and by having an anti-fraud centralised database, Piam would be able to monitor events related to fraud. Once the association had sufficient evidence that fraud had been committed, it would advise the member or members concerned to report the matter to the police or the Anti-Corruption Agency, he added. Lim also advised policyholders to be vigilant and to co-operate with Piam if they suspected fraud as, at the end of the day, if the menace was not detected, both the insurer and public would be losers. Information sharing between insurers in developed markets is more effective, resulting in better and more comprehensive anti-fraud database systems. Insurance fraud, Lim said, was difficult to quantify, and statistics were not readily available. It was difficult to attach value to this hidden crime. The industry had to rely on suppositions due to undetected fraud. But one could say it was on the rise judging from the total amount of premiums generated by the industry, Lim said. “For example, Germany-based insurer Munich Re, in a research some years ago, estimated that, depending on the market and the type of insurance business, as much as 10% to 30% of total premiums could be lost due to fraudulent insurance claims,” he added. On the performance of the general insurance industry, Lim said gross written premiums rose by 4.9% to RM9.688bil in 2003 from RM9.235bil in 2002. Besides improved business performance, the increase in gross written premiums was also due to higher premium rates imposed in tandem with the hardening of rates globally following the Sept 11, 2001, terrorist attacks in the United States, he added.

140 stolen vehicles recovered 31 December 2003, By The Star

KUALA LUMPUR: Sarawak police have so far recovered more than 140 vehicles stolen from the state and taken across the border. The recovery of the vehicles from “showrooms” in Kalimantan was made possible due to the close co-operation between the Indonesian and Sarawak police. Sarawak CID chief Senior Asst Comm (II) Abdul Razak Hasan said they had recently provided the Indonesian authorities with a new list of stolen vehicles taken from Sarawak to Kalimantan. “We have been in touch with our Kalimantan counterparts and have informed them of the need to seize and return the stolen vehicles. “They have responded positively and have so far handed back to us more than 100 motorcycles and 25 luxury vehicles,” he told The Star. SAC Abdul Razak said that a meeting would be held next month in Kalimantan where Sarawak police hoped to see more vehicles being returned. Cross-border syndicates do not tamper with the engine and chassis numbers unlike other car theft syndicates. According to sources, syndicate members across the borders allegedly issued new registration cards purportedly from the Road Transport Department there, to make it look as though the vehicles were registered in the neighbouring country. This, they said, made it difficult for police here to seize the vehicles as they had been issued with registration cards. They added that owners were forced to pay for their vehicles, failing which they would lose the vehicles. The Star reported yesterday that the syndicate was demanding ransom from car owners in return for the cars which were stolen by them. Showrooms are used to display the stolen vehicles to prospective buyers if the owners did not come to claim the cars or refused to pay the ransom. More than 500 luxury vehicles, mainly four-wheel-drive models, had crossed over the 1,480km Sarawak border and 12 syndicates had been busted in the past few months. Vital information obtained from the syndicate members revealed that many owners had personally gone to Kalimantan to negotiate the return of their vehicles after paying up to RM15,000. It was also reported that those who drove the vehicles into Indonesia were paid between RM1,500 and RM2,000 per vehicle.

Buying a stolen car … your own 29 December 2003, By The Star

Cross-border syndicates are stealing luxury cars in Sarawak and displaying them in mega showrooms in Kalimantan for the owners to pay ransom to get back their vehicles. It was learnt that the showrooms are also used to display the stolen vehicles to prospective buyers if the owners do not come to claim or refuse to pay the ransom. Sources said that more than 500 luxury vehicles, mainly four-wheel-drive models, have crossed over the 1,480km Sarawak border into Indonesian territory in the past few months. Sarawak Commissioner of Police Deputy Comm Datuk Fauzi Shaari confirmed that his officers busted 12 such syndicates and arrested scores of people in the past few months. “We have identified several more syndicates and our officers are conducting surveillance on them. “If everything goes as planned, we should be recovering more vehicles from these men,” he told The Star. It is learnt that a task force headed by state CID chief Senior Asst Comm (II) Abdul Razak Hassan and his anti-car theft operations commander, Asst Supt Abdul Razak Mohamed, had their first breakthrough with the arrest of seven men for wayside robberies. Investigations into their high-living lifestyle led police to uncover clandestine operations involving drugs, armed robbery and theft of luxury vehicles. Vital information obtained from the syndicate members showed that many owners had personally crossed over to Kalimantan to negotiate the return of their vehicles. After paying up to RM15,000, they were allowed to drive back their vehicles using the many illegal routes into and out of the country. Sources said police have identified 66 illegal roads used by the syndicates to enter Indonesia where the demand for such vehicles is high. They said those who drive the vehicles into Indonesia are paid between RM1,500 and RM2,000 per vehicle. It is learnt that police have identified three main syndicates – an all-Indonesian team, a local one and a joint venture between Malaysians and Indonesian – responsible for these activities. Police are appealing to owners whose vehicles have been stolen to lodge reports and assist police in their investigations and not to deal directly with the criminals.

Permits soon for tow truck operators 7 December 2003, By The Star

TAIPING: Tow truck operators will be required to register their vehicles and get permits from the Commercial Vehicles Licensing Board (CVLB) around February next year, board chairman Datuk Raja Ahmad Zainuddin Raja Omar said. He said the move was made following a Cabinet approval to regulate tow truck services in the country recently. “We hope to enforce the regulation before Chinese New Year celebrations next year. “But the implementation will depend on the Attorney-General Chamber’s decision on whether the CVLB Act should be amended or not, as at present there is no regulation that requires tow truck operators to register or get permits,” he said here yesterday. Raja Ahmad said operators would have to pay an annual fee of less than RM50 for each permit issued by the board. “We are not making money from the permits as our main intention is to regulate and discipline the tow truck operators,” he said. He said regulation was needed as there were many complaints of misconduct by tow truck drivers on the road, and of operators charging excessively.

New ruling for tow truck operators 6 December 2003, By The Star

WITH immediate effect, tow truck operators are required to apply for permits from the Commercial Vehicle Licensing Board to operate, Berita Harian quoted Entrepreneur Development Minister Datuk Seri Mohd Nazri Abdul Aziz as saying. Nazri, however, did not provide details of the permit application, which he said would be announced later. He said the Cabinet made the new ruling on Wednesday to better regulate tow truck services as many operators were often seen scrambling for business at accident scenes. “Sometimes, tow truck drivers and operators cause disturbances to other road users,” he said, adding that currently they were free to operate without any permit. Nazri was quoted as saying that in future, only tow truck operators with permits would be allowed to provide towing services much like taxi and lorry permits which are issued with conditions. He said the issuance of the permits for tow trucks would be done as soon as possible as there were many accidents during the festive and holiday seasons.

Punishing ‘bad’ drivers with higher premiums 2 December 2003, By New Straits Times

Higher insurance premiums may be imposed on drivers with poor traffic records, Transport Minister Datuk Seri Chan Kong Choy said today. He said his ministry, which had in principal agreed to implement the new system, would approach Bank Negara and the Finance Ministry on the matter. Chan said increasing insurance premiums was part of the Government’s efforts to inculcate a positive attitude among them. He was launching Kurnia Insurance (Malaysia) Bhd’s latest product, Kurnia Express, at the Hyatt Regency Saujana Hotel today, attended by Kurnia executive chairman Datuk S.K. Kua and managing director/chief executive officer Adrian Loh. A total of 8,297 road accidents and 174 road accident-related deaths were reported as of yesterday since the nationwide traffic operation Ops Sikap V was launched on Nov 20 to reduce the number of traffic accidents during the Hari Raya festive season. Prime Minister Datuk Seri Abdullah Ahmad Badawi had also called for stiffer penalties for errant drivers. Abdullah proposed that their driving licences be suspended for a time. On the retraining of heavy vehicle drivers, Chan said he was open to the idea, noting that such programmes were common in other countries. He also said the Commercial Vehicles Licensing Board’s proposal that the issuance of the Public Service Vehicle licence be reviewed and that bus drivers be sent for medical check-ups every three or six months would be studied. On the use of the black box in buses to detect speeding, Chan said it had caused resentment among various parties because of the additional costs incurred in installing it, but it was a necessary measure in view of the tendency of many drivers to speed. “It is high time we looked into this again given that the awareness on road safety is at the national level now. “We have to introduce whatever needs to be introduced to curb the problem. It is for the public good,” he said. On another matter, Chan said road accident victims or their families could take legal action against bus operators once police investigations indicated an accident was due to their driver’s negligence.

Cops nab three Singaporeans in luxury car scam 16 November 2003, By The Star

KUALA LUMPUR: Three Singaporeans from a freight forwarding company in the island republic have been arrested in connection with the shipping of 360 stolen cars from Malaysia worth RM36mil. It is learnt that Singapore police with the assistance of their Malaysian counterparts arrested the trio yesterday and seized another two luxury cars worth about RM350,000, believed to have been stolen and shipped to the republic by containers. Sources said KL City Deputy CID chief Asst Comm Syed Ismail Syed Azizan had gone to Singapore on Friday to brief his counterparts on the syndicate’s activities. Police have set up a special task force to investigate the syndicate which had successfully shipped 360 stolen cars using containers. The task force was investigating the networking of the syndicate and the number of agents involved. Initial investigations revealed that the syndicate could have had inside help from “crooked” Customs officers who had issued Customs clearance for shipping more than 360 such cars in 180 containers to Singapore since August. The syndicate is believed to have used a non-existent forwarding company to “export” the vehicles through Port Klang. The matter came to light with the seizure of 19 cars worth RM2.4mil in Port Klang last week. Customs director-general Tan Sri Abdul Halil Abdul Mutalib had said that several senior Customs officers had been identified as among those involved in the syndicate “exporting” stolen vehicles to Singapore. He said several senior and junior officers had been ordered to appear before an internal board of inquiry which was set up last week to investigate the allegation. Meanwhile, Inspector-General of Police Datuk Seri Mohd Bakri Omar and Halil are meeting tomorrow.

Car syndicate using Batam Island as transit point 18 November 2003, By Bernama

AN INTERNATIONAL syndicate has been discovered using Batam Island in Indonesia as a transit point for stolen luxury cars smuggled from Malaysia and Singapore, Berita Harian reported in its front page. The daily said smuggled cars worth millions of ringgit had been sold in Batam and re-exported from there to third countries in West Asia and Europe. Normally, the stolen cars’ chassis and engine numbers were altered and the documents forged, Berita Harian reported. The daily, quoting sources, said an Indonesian woman was believed to be the mastermind of the syndicate. It also quoted Batam police as admitting that they were suspicious of the presence of a large number of luxury cars at the resort island and were monitoring the situation through joint co-operation between the three countries. In a related article, the paper reported that Proton Perdana V6s had flooded the Indonesian island resort and many were seen on the roads and even used as limousine taxis at five-star hotels. It said the Batam police had set up a Vehicle Theft Unit after realising that the island had been used as a transit point for smuggled luxury cars from Singapore and Malaysia.

Editorial: Clearing Customs 17 November 2003, By New Straits Times

LAST week, the police smashed a syndicate “exporting” stolen cars to Singapore. Apparently, the shipping containers with the cargo of cars had been cleared by Customs enroute to Singapore. Customs director-general Tan Sri Abdul Halil Abdul Mutalib has not dismissed the possibility that the syndicate had received “inside help” and promised full co-operation in police investigation into the matter. When Customs clearance has been given, when a bogus forwarding agent is involved, when 360 stolen cars worth RM36 million have slipped through Customs, and how long this has been going on — there is clearly something wrong. It may just be a case of negligence in the performance of their duties, in which case the officials should be disciplined and reprimanded. Or it may be a case of corruption. If it is, those responsible must be prosecuted and made to pay for their crimes. Abdul Halil has given Prime Minister Datuk Seri Abdullah Ahmad Badawi the assurance that there would be no attempt to cover up or protect anyone. He had better deliver on that assurance. Abdullah has made fighting corruption one of the cornerstones of his administration. He has also made it clear that he wants correct information and not glossy stories from government officials in particular. As Abdullah said, “I have to ensure that information given to me is accurate, correct.” The Customs chief has not only to ensure accurate and correct information but take steps to eliminate the scourge of corruption from his department and send its perpertrators to jail and disgrace.==end==

Syndicate shipping stolen cars exposed 13 November 2003, By New Straits Times

Police have uncovered a syndicate which is believed to have obtained Customs clearance to ship more than 360 stolen cars worth about RM36 million in 180 containers to Singapore since August. Its activities in using a non-existent forwarding company to “export” the vehicles came to light with the seizure of 19 cars worth RM2.4 million in Port Klang on Friday and Saturday. Police detained a man and a woman, both purportedly workers of the “forwarding company” at an office building in Port Klang, to help in investigations. City police chief Deputy Commissioner Datuk Dell Akbar Khan was surprised as to how the cars were shipped through Northport in Klang using valid Customs forms. “We urge the Customs Department to facilitate investigations as to how they failed to detect the shipments and allowed them to go through the checks using valid Customs forms and under a non-existent forwarding agent,” he said at a Press conference. In an immediate reaction, Customs deputy director-general Abdul Rahman Abdul Hamid said he would only comment on the issue of how Customs clearance was obtained for the stolen cars when he had the full facts of the case. Dell Akbar said police made a breakthrough in the case when they raided a container terminal in Northport on Friday. The raiding team, led by ASP Loo Chee Fah, recovered 10 cars in five containers which were about to be shipped to Singapore. In a follow-up operation on Saturday, police seized four more containers filled with seven cars near the Northport industrial area. It is understood that Singapore authorities have seized a Mer-cedes C200 Kompressor and a Toyota Hilux at the Singapore port. Dell Akbar said officers would be sent to Singapore to make arrangements for the vehicles to be sent back to Malaysia. “We will seek the assistance of our counterparts in Singapore to check on the identities of those working with the syndicate in the republic,” he said. On the cars seized in Port Klang, he said they comprised seven Toyota Unsers, four Mitsubishi Storms, two Honda CRVs, a BMW 520i, a Toyota Estima, a Toyota Camry and a Toyota Altis. He said the syndicate’s modus operandi was to steal cars required on the black market for “export” to Singapore. The cars were later shipped to other destinations such as Indonesia, Thailand, South Africa and New Zealand. “This is the latest way of beating checks at the borders.” It is understood that police may interview several Customs officers to help facilitate investigations. Police were also looking for a man, believed to be a worker of the “forwarding company”, and identified as Jeganathan Subramaniam, 25, whose last known address is at 243 Jalan Kastam, Pelabuhan Klang, Selangor. Those with information on his whereabouts can contact the city police headquarters at 03-21465222.

KUALA LUMPUR: It is the end of the road for a well-organised car theft syndicate which is said to have exported some 360 vehicles worth over RM36mil to Third World countries over the past three months. A total of 19 vehicles worth RM2.4mil were recovered in a series of police operations last week codenamed Ops Cobra Kontena, following the arrest of a man and a woman last Saturday. The vehicles were seven Toyota Unsers, four Mitsubishi Storms, two Honda CRVs, a BMW, a Toyota Estima, a Toyota Camry, a Toyota Altis, a Mercedes and a Toyota Hilux. City police chief Deputy Comm Datuk Dell Akbar Khan said the syndicate was well organised and run by “a combination of persons to promote a common interest.” He said the mastermind would inform his middlemen of the types of vehicle which were in great demand on the black market. “The middlemen would then look for thieves and robbers to get the vehicles, which would then be exported to Singapore through Northport,” he said. Singapore, DCP Dell said, was merely a transit point as the vehicles were meant for Third World countries. Intelligence had shown that some of the vehicles were seen in Indonesia, Thailand, South Africa and New Zealand. At a press conference at the city police headquarters yesterday, DCP Dell said a team from the Crime Intelligence Unit, headed by Asst Supt Loo Chee Fah, raided the Terminal Kontena at Northport in Port Klang last Friday. He said the operation was held based on information that the vehicles would be smuggled through the port.==end==

Close co-operation between the Malaysian and Singaporean police led to the crippling of 46 car-theft syndicates in both countries within the first eight months of the year. Criminal Investigation Department deputy director (1) Deputy Commissioner Datuk Mohd Nawawi Ismail said police on both sides of the Causeway planned to further enhance co-operation. He said Singapore police recently crippled a Malaysian car-theft gang and recovered a large number of mostly luxury vehicles. “Between January and August this year, a total of 10,235 cars worth RM126.1 million were stolen in this country,” he said. Mohd Nawawi pointed out that motor vehicle thefts represented half of the overall crime index in Malaysia. Last year, 60,251 vehicles comprising cars, motorcycles, trucks and others were reportedly stolen. This figure made up 40.5 per cent of the crime index of that year. “This is an increase of 0.34 per cent or 202 cases compared to the number of vehicles stolen in 2001,” said Mohd Nawawi. He said this after a handing over ceremony of 23 stolen Malaysian vehicles by the Singapore police at the Sultan Abu Bakar Customs Complex in Tanjung Kupang here today. Also present were Singapore CID deputy director Superintendent Ng Joo Hee, Johor CID chief Senior Assistant Commissioner (II) Tan Seng Eng and State Customs director Sarmin Md Hussin. Ng said the recovery of the 23 stolen cars, which have an estimated value of RM2.65 million, was made possible through good networking with their Malaysian counter- parts. “We managed to recover the cars following the arrest of four men, including a Malaysian. “The suspects are between 34 and 51 years old and believed to be members of a car-theft syndicate which used the republic as their market and transit point to third countries,” he said. Ng said although the stolen vehicles bore different registration numbers, the original registration numbers were traced through the cars’ engine and chassis numbers. Earlier at the ceremony, Mohd Nawawi said several task forces had been set up to tackle the rising number of vehicle thefts. “I take pride to note that the for-mation of these task forces has achieved encouraging results.” He said last year, the task forces had successfully recovered 9,307 stolen vehicles and arrested 5,784 suspected syndicate members — of whom 2,688 were charged in court. The total value of recovered stolen vehicles last year was estimated at RM143.6 million.

High-charging hospital slashes fees 2 October 2003, By The Star

Singapore: TALK about instant action. On Monday, Alexandra Hospital did not look too good when the Health Ministry released a list of charges for 28 hospital treatments. It was found charging subsidised patients the highest prices for the three most common treatments. But within 24 hours, the hospital moved to slash prices for two procedures, and assured patients that it had already cut charges for the third. Down went the bill for gastroscopies: S$175 (RM385) on Tuesday, S$125 (RM275) yesterday. Down went the charge for colonoscopies: from S$320 (RM704) to S$280 (RM616). The charge for cataract surgery, which the ministry listed as costing S$1,051 (RM2,312.20) at Alexandra, was cut to S$830 (RM1,626) two weeks ago. The hospital said it managed to cut the cost of cataract surgery after buying in bulk a lens needed for the surgery through a group purchasing scheme. The spokesman said the price used to be high because Alexandra did not enjoy economies of scale. Over the last 12 months, it did just over 400 of the 11,600 cataract operations in the public sector. These three procedures were highlighted by the press as they affect over 30,000 patients a year. – The Straits Times/Asia News Network

RM2 for 150cc m-cycle licence 17 September 2003, By The Star

PUTRAJAYA: Owners of motorcycles 150cc and below must pay RM2 for a new motor vehicle licence or renewal, following the Budget 2004 regulation to exempt this category of motorcycles from road tax. Those who had paid the usual amount on or after last Saturday could get a refund at the Road Transport Department (JPJ). Transport Minister Datuk Chan Kong Choy said yesterday the licence would only be issued if the application came with a valid motor insurance – at least third-party insurance. “Owners have to pay RM2 for every transaction and they can choose to either renew their licence every six months or yearly,” he said. He said transactions could only be done at the JPJ for the time being, but would also be possible at post offices once they upgrade their system. “The post office will make an announcement on when it can resume transactions,” Chan said, adding that the usual RM2 service charge imposed by the post office would remain. He said the exemption involved 4.17 million motorcycles and would mean RM224.4mil less revenue for the Government. Prior to the exemption, the charge for such motorcycles was between RM50 and RM65 in the peninsula, RM50 in Sabah and between RM12 and RM24 in Sarawak. Chan said the RM1 charge for motor vehicle licence for motorcycles with a net weight of not more than 250kg – specially modified for the handicapped – would remain unchanged. He said the handicapped who owned locally made motorcycles, cars and vans would only need to pay RM2 for their motor vehicle licence, also provided they had at least valid third-party insurance. On the 50% discount on road tax for buses used to ferry workers, Chan said the owners would get the discount when they renewed their licences. He said they paid between RM238 and RM480, depending on the engine capacity, prior to the discount.===end===

Bank Negara has embarked on a 10-year programme in collaboration with industry players to educate consumers on insurance and takaful. Speaking at the launch of its Consumer Education Programme on Aug 29, Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz said the programme was part of an on-going effort to help consumers understand financial products and make better-informed decisions in financial planning. “This Consumer Education Programme for the insurance sector will extend over a ten-year horizon and will be undertaken on several levels under a step-by-step approach to reach out to the various target groups,” she said. Zeti said in its first year, the programme would focus on the dissemination of information in 12 priority areas. This would include issues on the fundamentals of insurance and takaful products and services, their terms and conditions, rights and obligations under a policy contract as well as the redress avenues available to consumers, she said. She added that the central bank had produced 12 booklets on these subjects in association with the Life Insurance Association of Malaysia, General Insurance Association of Malaysia and Malaysian Takaful Association. These booklets could be obtained from the offices and branches of insurance companies and takaful operators as well as selected branches of banks that offer bancassurance.===end===

InsuranceInfo programme to be over 10 years 30 August 2003, By The Star

BANK Negara, in collaboration with the Life Insurance Association of Malaysia (Liam), Persatuan Insuran Am Malaysia (Piam) and Malaysian Takaful Association (MTA), have launched a consumer education programme for the insurance and takaful industry. The programme, which was given the acronym “InsuranceInfo,” would be extended over a 10-year horizon and would be undertaken at several levels to reach out to various target groups. In her keynote address at the launching ceremony in Kuala Lumpur yesterday, Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz said the programme aimed to promote public understanding of critical information on insurance and takaful products and services, to familiarise the public with underwriting and claims processes, as well as to create awareness in making decisions. “It is also to promote greater awareness among consumers about the means and avenues for redress in the event of dispute or dissatisfaction with any insurance products or services,” she added. In its first year, the programme would focus on the dissemination of information in 12 priority areas, including the fundamentals of insurance and takaful products and services, the important terms and conditions, rights and obligations under a policy contract, the redress avenues available, and the common insurance and takaful products. It would entail the publication of a series of 12 booklets to be available at selected branches of insurance companies and takaful operators. The www.insuranceinfo.com.my, website has also been developed. “The consumer education programme represents one of several important elements in the overall strategy to enhance the consumer protection infrastructure. “To achieve high standards of market conduct founded on principles of integrity, sound ethnics and professionalism, Bank Negara has adopted a combination of regulatory policy instruments, which include policy development, regulatory initiatives, compliance reviews and ongoing surveillance,” Zeti said. Later, at a press conference, the organising committee chairman L. Meyyappan said the insurance and takaful industry was fully committed to reaching out to consumers and building upon the trust and confidence in their products and services to ensure savings and protection of the public. He added that, in addition to the programme, the insurance associations had undertaken various initiatives, which included MTA’s collaboration with Association of Islamic Banking Institution Malaysia to organise the Islamic Banking and Takaful Week from Sept 26 to Oct 2. On the prospects of the local insurance industry, Liam president K.H. Chia said new life insurance business was expected to grow by 15%-20% in the next three years. Piam chairman Anuar Mohd Hassan had a forecast of 10%-15% growth in the general insurance business. MTA chairman Datuk Mohd Fadzli Yusof, meanwhile, expects an annual growth of 30% in the next three years, as the penetration rate of takaful insurance was still relatively low.===end===

Bank Negara: New insurance framework being worked on 14 August 2003, By The Star

BANK Negara is making efforts to develop a new motor underwriting framework to replace the one currently in use, which has not been reviewed since 1978. The revision was aimed at introducing a new framework that would be fairer and more equitable to consumers, it said in a statement in response to a report in The Star that the central bank had rejected a proposal by insurers to review the motor tariff. Bank Negara also denied that it had rejected the proposal by the insurers, saying that it had not issued such a statement. “It is a misconception that the proposed motor tariff framework will result in an upward revision in premium rates. Certain segments of motorists will, in fact, enjoy premium reductions,” it said. Meanwhile, industry players said although Bank Negara and the insurance industry had agreed on the framework to deregulate premiums – particularly for the fire and motor classes, currently fixed by tariff – they differed on what impact such deregulation would have on insurance premiums. “In theory, driven by competition, insurance companies could lower premiums. But it would only be a matter of time before insurance companies count their losses and start to increase rates,” an official of a leading insurance company said. Industry players said the industry, through the General Insurance Association of Malaysia (Piam), had proposed to revise the motor tariff some two years ago but had their proposal rejected by Bank Negara, which believed it could eventually lead to an increase in premium rates. The source said the industry was asked last year to come back with a new proposal, which would, among other things, include “sweeteners” for policyholders to justify an increase in insurance premium. The latest proposal – which will see policyholders essentially getting additional insurance coverage, but at higher rates – has yet to receive the green light from Bank Negara. “Because of the impasse, some industry players are of the opinion that the second proposal, too, was not acceptable to the central bank,” he said, adding that Piam had also indicated to its members that it had little hope for insurance rates to be reviewed any time soon. This has prompted Piam to propose a review of its Malaysian Insurance Rating Organisation (Miro), originally tasked with conducting a study on tariff review. A Miro official told insurance executives recently that the organisation would be transformed into a new independent entity called Insurance Services Malaysia (ISM), merging with a PIAM insurance services unit. Insurance players said ISM was expected to act more in line with the Insurance Sector Masterplan, and thus help the industry to put forward a much better case for liberalisation. “Given that ISM would be collating wide ranging statistics, smaller insurance companies which currently don’t have the expertise could use the data to design their own products,” he said. In addition, the majority of the insurance industry believed that the fixed tariff must first be removed before any of the objectives proposed under ISM could be workable. They said the current tariff-based structure could hinder insurance companies from operating in a truly open fashion. As for the main issue, revision of motor insurance tariff, which is one of Miro’s main objectives, most players in the industry agreed that it would take a long time before any deregulation of insurance tariff could happen. “I don’t see the current tariff being removed for at least another five years,” said an insurance executive with a leading insurance company. ===end===

Bank Negara has not rejected a review on motor tariff 13 August 2003, By The Edge

Bank Negara has denied a press report that the central bank had rejected a proposal by insurers to review the motor tariff. “A recent news report that Bank Negara has rejected a proposal by insurers to review the motor tariff is not correct. Bank Negara has not issued such a statement,” the central bank said in a statement on August 13. A front-paged report in a local tabloid on the same day said motorists had been spared from paying higher motor insurance premium following Bank Negara’s decision to reject a proposal by insurers to review tariffs and ask for a counter proposal. The central bank said efforts were being undertaken to develop a new motor underwriting framework, which has not been reviewed since 1978. “It is a misconception that the proposed motor tariff framework will result in an upward revision in premium rates. Certain segments of motorists will in fact enjoy premium reductions,” Bank Negara said. It said the aim of the review was to introduce a new framework that would be fairer and more equitable to consumers. ===end===

COMMUNITY CARE THEME FOR INSURANCE DAY 2003 15 July 2003, By PIAM

Kuala Lumpur, July 15 – Come July 27, members of the insurance fraternity in Malaysia will celebrate this year’s Insurance Day with a multitude of community-based programmes nationwide in what is believed to be the single largest community exercise ever staged in a day. More than fifty (50) different programmes and activities have been planned in major cities across the country, involving all the general and life insurance companies who are members of the General Insurance Association of Malaysia (PIAM) and the Life Insurance Association of Malaysia (LIAM). “Caring for the community” is the theme for this year’s Insurance Day, according to PIAM’s chairman, Encik Anuar Mohd Hassan. “We have asked our members to organize charitable and community-based events on that day and to involve their branch offices throughout the nation in this project. We hope Malaysians from all walks of life will come forward and support the various events and activities that the insurance companies have organized as part of Insurance Day 2003”. July 27 has been designated as the Insurance Day to carry on the spirit of caring for the nation following the success of the “One Nation We Care” mega-event held last year at the Bukit Jalil National Stadium. That event was graced by none other than the Prime Minister Datuk Seri Dr Mahathir Mohamad who together with the insurance industry and over 65,000 Malaysians celebrated the unity and harmony enjoyed by the nation under his leadership. En Anuar said, “As members of PIAM and LIAM believed that the spirit of goodwill, unity and harmony generated by the One Nation We Care event should continue to be nurtured, the insurance fraternity has agreed to carry on the tradition of caring for the nation and the community through organized events and activities annually on July 27th.” En Anuar earlier called upon insurance companies’ staff at the head office and branch offices in different states to organize activities that would involve the community especially the under-privileged. “On this front, we are glad that many of our members have responded in a most admirable way to this call”. Some of the activities lined up for July 27 include charity runs, charity golf tournaments, jumble sales, blood donation drives, food and fun fairs, trips to parks and zoos for under-privileged children, visits to orphanages and homes for the aged. Encik Anuar and LIAM’s Chairman Mr KH Chia also unveiled the logo for this year’s National Insurance Day. In line with the “Caring for the community” theme, the logo incorporates a group of people representing the community within a heart shaped design. “The heart signifies the caring component of the campaign and the people denote those that the industry seeks to help,” said the creator of the logo, Samantha Chao. Samantha’s logo was selected from over 90 entries submitted from employees in the insurance industry. ==end==

Government looking for suitable Act to protect motorists 24 April 2003, By The Star

The Government is looking for a suitable model for the Motor Vehicles Repair and Service Act to ensure consumers will not be short-changed when their motor vehicles are repaired and to maintain high standards of automotive mechanical skills. Currently, the Domestic Trade and Consumer Affairs Ministry is studying models of the law from the United Kingdom, United States, Canada, Australia and New Zealand. Its minister Tan Sri Muhyiddin Yassin said the Cabinet gave its green light to monitor the service of motor workshops and to ensure that mechanics were certified for such repairs. The proposed Act will look into the licensing issues and certification of mechanics and repairers. “We want to ensure workshops are equipped with the right tools and skilled mechanics as consumers must be confident that they are able to undertake repairs on cars with new technology,” he said at his ministry’s weekly post-Cabinet meeting at the Menara Dayabumi here yesterday. Muhyiddin said this new law would also prompt the setting up of a training institute for mechanics and motor vehicle repairers, adding that those undergoing these courses must pass levels of curriculum before they were certified. The ministry, he said, would also be going on a nationwide check on workshops to monitor if they adhered to the recent guidelines issued by the ministry on the display of service and spare parts price lists. “The ministry has found that there are many workshops that are still indifferent to the guidelines. In some instances, the ministry has also received complaints that many workshops are overcharging customers and claiming that the charges were set by the Government,” he said. He said since the guidelines were enforced in July last year, about 20 cases of non-compliance in displaying price lists had been recorded.==end

A serious crime to lodge false report 16 December 2002, By The Sun

KUALA LUMPUR: Police have warned that stern action awaits those who lodge false reports on the theft of their vehicles in order to make a quick buck through insurance claims. In an incident on Friday, a 28-year old woman from Shah Alam was detained by police after she was found to have made a false report that her car was stolen. She had claimed that she had parked her car at the porch of her house on Thursday night and found it missing the following day. On receiving her report, police spotted the car in the vicinity of the township within hours, and arrested a 42 year-old man who was behind the wheel. During interrogation, the man said the woman had allowed him to keep the car as collateral for a RM8,000 loan he had given her. The woman, a customer care consultant, was called in by police for questioniing, and later confessed that she had run into bad debts and had resorted to borrowing money from loan sharks. Selangor state CID chief Abu Bakar Mustafa said police are viewing the case very seriously. “People with such intentions should not make a mockery of the police by involving them in the process of cheating. It can land them in big trouble with the law,” he said. He also said they can be charged with lodging a false police report under Section 182 of the Penal Code.

Most car owners ‘don’t have flood coverage’ 30 April 2001, By The Star

Kuala Lumpur: Most of the car owners whose vehicles were damaged by floods on Thursday will not be able to claim insurance unless they have opted for additional coverage for natural disasters. A general manager of an insurance company said most private vehicle owners do not opt for such coverage as it means additional premiums. “Damage to vehicles in floods is an extension of the private vehicle policy or insurance cover,” he said. General Insurance Association of Malaysia (PIAM) executive director C. F. Lim said most standard private car policy excludes cover for loss or damage due to floods. “Vehicle owners are advised to consult their insurers on the scope and cost of this extension cover,” he added. Another insurance industry official said most owners did not buy such cover as they had to pay an additional 0.5% of the value of the car. The floods which affected several parts of the city on Thursday damaged hundreds of cars. —end—

Chan: Insurers want review of motor tariff 17 April 2001, By The Star

The motor insurance premium rate drivers are paying now is “23 years old” as it has yet to be changed since 1978, said Deputy Finance Minister Datuk Chan Kong Choy. Replying to Ng Lip Yong (BN – Batu), he said the General Insurance Association (of) Malaysia (PIAM) had proposed that the tariff be reviewed. “The review does not necessarily mean that the premium will be increased. If consumer claims on a certain category of the insurance are good (low), the premium for that category might be reduced,” he said. Chan said in 1999, the claims for general insurance totalled RM2,531mil. The claims for loss of vehicle due to theft was RM291mil or 17% of the total compensation paid. The claims for damaged assets, injury and death were RM1,340mil or 83%. The claims for loss of vehicle due to theft increased last year to RM340mil or 19% of the total compensation made by insurance companies.